Thu, Sep 07, 2017 - Page 10 News List

Analyst says Facebook ads figures don’t match census

Reuters

Figures Facebook Inc gives advertisers about its potential reach differ from US census data, an investment analyst said on Tuesday, renewing questions about how tech companies verify the value of their digital marketing space.

Facebook’s ad-buying Web site tells advertisers that the world’s largest social network has a potential reach of 41 million people aged from 18 to 24 in the US, whereas US census data show that last year there were 31 million people in the US in that age bracket, Pivotal Research Group senior analyst Brian Wieser said in a note.

The gap persists for those aged 25 to 34 and is not widely known among ad agency executives, Wieser wrote in the client note, adding that the gap might cause large advertisers to step up demands for third-party measurement services.

Wieser, unlike most stock analysts, maintained a “sell” rating on Facebook’s shares.

Facebook said in a statement that its audience estimates did not match census data, but added that this was by design, as ad-reach numbers “are designed to estimate how many people in a given area are eligible to see an ad a business might run.”

“They are not designed to match population or census estimates,” the company said.

People on Facebook self-report their ages, so these might also vary from census data, it said.

The company also uses location data from mobile devices to estimate its reach, meaning that it counts tourists and other visitors.

About 5.6 million non-residents visited the US in January, the most recent month for which the US Department of Commerce has published data.

Last year, Facebook apologized to advertisers after finding that the average time users spent viewing online ads had been artificially inflated, because it was counting only videos that were watched for at least three seconds, its benchmark for a “view.”

In November last year, Facebook launched a blog called Metrics FYI to share updates and corrections for its data.

“While Facebook’s measurement issues won’t necessarily deter advertisers from spending money with Facebook, they will help traditional TV sellers justify existing budget shares and could restrain Facebook’s growth in video ad sales on the margins,” Wieser said.

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